The benefits of awakening your artistic side in retirement, plus how much money you might need to retire in your 50s

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It was after retiring from his career as an ophthalmologist in 2020 that Peter Waind was able to reignite his dream of becoming an artist. He took some art courses as an undergraduate student, and did a bit of photography over the years, but the demands of his ophthalmology practice and surgery schedule always took precedence. Once retired, Mr. Waind started taking courses to pursue a long-time passion for drawing and painting.

“I like the expressiveness of paint when it’s a little bit out of control,” says the 68-year-old from Waterloo, Ont., describing it as “an opportunity for the other side of your brain to drive the bus.”

Last summer, one of his instructors at the Haliburton School of Art and Design in Haliburton, Ont., urged him to enroll in the college’s drawing and painting program in the fall. Mr. Waind, one of three mature students in his class, graduated in the spring and was “thrilled and surprised” to be awarded for the highest achievement in the course.

More seniors are revisiting their love for art in their retirement years as a way to express themselves and pass the time. The good news for retirees is that you don’t need an artistic background to take up drawing, painting or other art forms, says Kate Dupuis, the Schlegel innovation leader at the Sheridan Centre for Elder Research in Oakville, Ont. Kathy Kerr reports.

When should Peggy and Howard sell their rental property – and their own family home?

When they first had a Financial Facelift, Peggy and Howard were just starting out, “first home, first kid, first professional jobs,” Peggy writes in an e-mail. A quarter century has passed since then. They’ve moved from the Prairies to an Ontario bedroom community. Howard is now 62, Peggy is 60. Both have government jobs paying a combined $250,000 a year with defined benefit pension plans. They also have a rental condo where their son lives with a roommate.

Now, with their working years approaching an end, they’d like to help their two children financially. “We never expected to have this ability,” Peggy writes. Given that they will have a “relatively healthy pension income, which is not inheritable, we would like to consider options for gifting to help our kids get ahead sooner rather than later.”

Howard plans to retire from work in 2024, at age 64, and Peggy in 2025, at 63. When they do, they plan to sell the rental condo and give partial proceeds to their children. They would sell the family home and move to another town.

Their questions: When is the best time to sell the condo to minimize capital gains? Should they contribute as much as possible to their registered retirement savings plans while they are working, then live off their withdrawals for a few years until they begin collecting Canada Pension Plan and Old Age Security benefits at age 70? Should they buy their retirement home in a nearby town now or wait until they retire?

Their retirement spending goal is $100,000 a year, which includes a comfortable travel budget.

In the latest Financial Facelift article, Denny Oenar of Macdonald, Shymko & Co. Ltd. in Vancouver, a fee-only financial planning firm, looks at Peggy and Howard’s situation.

In case you missed it:

The important financial steps to take after a spouse dies

Death, while inevitable, is not often predictable, and this can leave many people financially unprepared if their spouse suddenly dies – especially if the deceased was the one that took care of the household balance sheet.

This is why it’s important for financial advisors to prepare clients with the steps they need to take before the death of a partner, as well as what is required after the event occurs. It may seem cold, but it’s a life event, and like other life events it requires financial planning.

“Having a financial plan is like the blueprint to your wealth plan,” says Mark Slater, senior wealth advisor and portfolio manager at Slater Financial Group at CIBC Wood Gundy in Toronto. “I think everyone should have a financial plan and understand where all their sources of income are coming from before and after the death of a spouse.”

Mr. Slater gives his clients a basic spreadsheet to fill out so they know exactly what their financial picture would look like before a spouse passes and after.

This also helps to know what questions to ask to fill in any gaps, such as: What health benefits does a spouse have? Is the living partner entitled to those benefits after death? Should the client make certain accounts joint accounts prior to death to make it easier to access upon death? What are the household investments and do both parties have access after death? Daina Lawrence reports for Globe Advisor.

Ask Sixty Five

Question: Of course everyone’s spending is different, but is there an “ideal” amount of money you should have saved to be able to retire in your 50s?

We asked Mike Preto, an investment advisor at Hillside Wealth Management, iA Private Wealth, in Vancouver, to answer this one:

Great question and, as with many answers to personal finance questions, the short answer is “it depends.”

Is there any rental or pension income, how much are you looking to spend, do you have a mortgage, what’s your risk tolerance, is your portfolio in your RRSP or is it non-registered? The list of variables is long. But we can shed a lot of light on this without knowing all the details.

A very simple rule of thumb for anyone retiring in their mid-50s is, with an asset allocation of roughly 60 per cent stocks and 40 per cent bonds, they can safely draw out 3.5 per cent of whatever their portfolio is worth at retirement. So, if you have $1-million invested, you can safely draw out $35,000 annually and have a very high probability of never running out of money. Following this rule will keep you out of trouble and keep you from enjoying the full potential of your portfolio.

A more dynamic approach is to develop realistic retirement planning assumptions, which include future Old Age Security (OAS) and Canada Pension Plan (CPP) figures and all other retirement income sources.

Be conservative when it comes to your rate of return expectations; a 2 per cent inflation-adjusted rate of return works well.

Based on these assumptions, develop a realistic retirement lifestyle target. Then, update your retirement projections annually and see where you’re at relative to your targets. If you have more invested than is required to hit your lifestyle target, calculate by how much.

The resulting surplus is a cushion that will soften the blow of meaningful market corrections, and shouldn’t be entirely wiped out. It also represents money you don’t need to continue to stay on track and some of it can absolutely be used over and above your annual target retirement lifestyle. Before you develop a surplus, take the time to think about what you really want to do. When you tap into your surplus you want your money to go toward something meaningful.

This approach is simple, logical and powerful. It encourages you to spend more when your portfolio is up and less when it’s down – exactly the kind of behaviour that will keep you out of trouble. It allows you to enjoy life responsibly while holding you accountable to a set of parameters that will protect your future.

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Have a question about money or lifestyle topics for seniors? Please e-mail us your question at sixtyfive@globeandmail.com and we’ll try to find an expert to answer it in a future newsletter. We can’t answer every question, but we’ll do our best. Note: questions may be edited for length and clarity.